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DeLeo commits to 'smaller' revenue package

By Matt Murphy, State House News Service

Updated:
03/08/2013 09:04:10 AM EST

BOSTON -- House Speaker Robert DeLeo told business leaders Thursday that the House is committed to finding new revenue to support transportation needs, but will call for a revenue package "of a significantly smaller size" than the proposal offered by Gov. Deval Patrick.

With MBTA officials warning of another round of fare increases without additional funding, DeLeo's comments are not unexpected given the Speaker's previous promises to address a transportation financing fix early in the session, and concerns raised in recent weeks by legislative leaders about the scope of the governor's budget.

DeLeo, speaking before the Greater Boston Chamber of Commerce, highlighted his desire to use gambling license revenue for a new initiative to link community college programs with the needs of employers in the science, technology and engineering fields.

Warning of "collateral damage" if lawmakers reach for too much revenue through taxes, DeLeo said the House will develop a "well thought-out and fair new source of revenue to help fund a transportation system." That revenue stream, according to DeLeo, will be "one that is commensurate with job creation, job retention and economic growth."

Patrick has been pushing hard to win support for his budget plan that raises $1.9 billion in new tax revenue through a series of tax code changes. Patrick wants to invest heavily in transportation, infrastructure and education, including early-education programs and colleges and universities.

The governor's proposal includes $1 billion in new investments for transportation and infrastructure financed by raising the income tax a full percentage point to 6.

"I'm worried that the administration's proposal places too heavy a burden on working families and businesses struggling to survive. We want to minimize the pressure on Massachusetts citizens as we find ways to meet our goals. If we are to pass a new revenue package, I believe it should be far more narrow in scope and of a significantly smaller size," DeLeo said.

The House appears to be moving toward addressing transportation financing with separate legislation ahead of the April 10 release of the House Ways and Means budget, a path that would require details of the House revenue plan to be released very soon.

DeLeo told the News Service on Wednesday that separating the two issues will give lawmakers a better opportunity to debate the merits of a revenue proposal. Careful not to forget the importance of continuing to search for savings, DeLeo in his speech announced a March 12 Transportation Committee oversight hearing "to determine if additional savings can be identified."

DeLeo said the Massachusetts Department of Transportation must "wean" itself off a long tolerated practice of paying for operating expenses, namely employee salaries and benefits, with borrowing that costs the state more over time. Making such a change has been estimated to cost roughly $250 million.

Transportation Committee Co-Chair William Straus last month suggested the House might favor tax or fee increases targeted at transportation system users to fund new investments instead of Patrick's more broad-based approach. Patrick has also called for periodic and scheduled increase in the gas tax, Registry fees and MBTA fares.

In addressing the business crowd, DeLeo said he has heard from small business owners and large corporations that "a strong transportation system and highly educated work force are critical to the economic health of Massachusetts."

Though Patrick has called for significant investments in young learners to eliminate waiting lists for early education programs, DeLeo made no mention of early education, instead focusing on community colleges and improving their links to the business community.

DeLeo said state funds directed to community colleges are "seed money" for job growth and economic prosperity for the state.

The speaker also proposed a new initiative he calls the STEM Starter Academy, an "intense" program at community colleges focused on training students for jobs in science, technology, engineering and math.

Anticipating $195 million in gaming license revenue to the state "very soon," DeLeo said $30 million of that funding will go toward a community college fund created by the Legislature when it passed the state's expanded gaming law, and can be tapped to fund the Starter Academy and other initiatives.

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